Anyone reading this article is more than likely a member of the LAPL. Let me first express thanks and appreciation for your support of your local association. Your dues are important, of course, and absolutely necessary, but those dues don’t do anything until put into action by the volunteers that make the LAPL work.

Many readers have already experienced the behind-the-scenes world of the LAPL, but many have not. I personally have been involved in various capacities for about 10 years now and have enjoyed every bit of it. I look back fondly at my pre-involvement days when I looked in admiration at the various volunteers and Executive Committee members, having a real appreciation for what they accomplished—luncheons, newsletters, social and educational events, etc. I was also impressed by the camaraderie that was so evident and hoped to be a part of something like that one day.

Over these past 10 years I guess you could say that I’ve been involved in virtually aspect of the organization in one capacity or another. In so doing, I have had the pleasure of meeting and working with fellow volunteers. It is so true that you really get to know a person by working on a project together. As such I have developed deep friendships that I would otherwise not have had it not been for my involvement in the LAPL.

The purpose of this article is not to document what I have done, but rather to encourage the readers to get involved. Any volunteer organization is always faced with seemingly-conflicting tasks. On the one hand, controlled turnover is critical. Anyone who has done board or committee work knows that the customary ‘shelf life’ of an individual in any one position is 3 years. Boards and committees try to stagger terms so that about a third of the representation is replaced each year. At the same time, ‘organizational memory’ is critical as well, so that important lessons learned in the past are not lost due to this same desired turnover. I believe LAPL is structured in such a way as to balance the two opposing forces, but said balance only works when members are willing to step up and serve.

There are many ways to get involved. All of the many committees need fresh ideas and energy. Board and Executive Committee nominations are right around the corner as well. I hope you will seriously consider getting involved. To do so, contact David Deville at 237-1296 or Pete Van Der Veldt at 988-9256.

Seeking a landman with substantial Mississippi experience for immediate placement. Must be located within driving distance of Lafayette, LA and maintain active AAPL membership. Please email resumes to hiring@tdoil.com and enter "Mississippi Landman" in the subject line. Candidates with no Mississippi experience need not apply. No phone calls, emails or direct messages please.

Carol Trosclair Awarded Local Businesswomen's Award

Congratulations to Carol Troslair, independent landman, who was one of nine women in Acadiana receiving the 2015 Women Who Mean Business award today. Carol's drive and personality make her a deserving recipient for such an award!

I know everyone is working hard to stay busy these days, but stormy seas spawn skilled sailors, and I trust we will all weather the storm. Given the current economic down turn in our industry, I anticipate we will be seeing more due diligence projects becoming available for the good and the bad. Therefore, I have compiled a short list of helpful websites most of don’t use on a regular basis . You may have already utilized most of these sites, but hopefully I will provide you with at least one new resource.

https://pacer.login.uscourts.gov : Pacer provides public access to case and docket information from federal appellate, district, and bankruptcy courts. You can check on the status of an open bankruptcy and view most of the latest filings. Registration is free and searches are charged at ten cents per page, but free if your total charges are under $15 for the quarter.

http://www.sec.gov/edgar/searchedgar/webusers.htm : Edgar is an online database from the SEC used by all publicly traded companies to transmit their quarterly reports, annual reports filings and other disclosure obligations. Yep, there is usually more than is just on their webpage. Also, if you have an unknown company in your play try performing a boolean search on Edgar.

http://www.glorecords.blm.gov : Can’t find your land patent in the courthouse? You may be able to pick it up on the Bureau of Land Management’s GLO records. They also have historical survey plats similar to those found on the Louisiana Division of Administration’s Office of State Lands webpage at http://www.doa.la.gov/Pages/osl/Document.aspx.

http://www.fws.gov/wetlands/ : Is the Corps of Engineers in your future?The US Fish & Wildlife Service’s wetlands mapper is a great resource accessible from your desktop.

http://www3.epa.gov/enviro/facts/multisystem.html : The EPA’s multisearch allows you to search multiple environmental databases from one platform by facility name or geographic area.

http://edms.deq.louisiana.gov/app/doc/querydef.aspx : The Louisiana Department of Environmental Quality has an electronic repository of records created and received by the DEQ. Even if you don’t perform any environmental due diligence, it’s always nice to know what’s close to home.

https://mycpa.cpa.state.tx.us/coa/coainst.html : If you have ever used the Texas Secretary of State’s webpage you know there is a charge to conduct a corporate entity search. However, if you regularly work in Texas you know the corporate address and officer information can be accessed from the Texas Comptroller of Public Accounts for free.

http://ullafayettefoundation.org/ : Most importantly, and particularly if you found any of the above information useful, please help lend your support to the Moody College of Business Professional Land and Resource Management Program (PLRM Promise) by making a donation. No donation is too small! Just use the link, click on make a gift, and select the College of Business in the drop down menu. Fill out contact and payment information, then designate your gift at the bottom of the page in Gift Details: “to the Lafayette Association of Professional Landman fund”. Let’s meet our goals for the Year!

Those of us that have enjoyed the Sportsman’s Paradise that is Louisiana by hunting, fishing and exploring the great outdoors and those of us who have had the pleasure and good fortune to work as landmen running title in our great state have likely confronted the issue of determining whether a waterway is privately owned or public and/or who owns the bed or bottom and the banks of these waterways. The changing course and/or widening of waterways in Louisiana, be it the Red River in Bossier and Caddo Parishes, Calcasieu Lake in Cameron Parish, Grand Lake-Six Mile Lake in St. Martin and St. Mary Parishes and even the Mississippi River present unique title issues to private landowners, the state of Louisiana, and oil and gas industry folks, including oil and gas landmen and title attorneys. In addition, coastal erosion has a similar effect on title and, therefore, mineral ownership. These questions of ownership can create a nightmare for an exploration and production company trying to take leases near a waterbody in Louisiana and/or pay royalties on oil and gas leases covering the land in question. Therefore, we will address the basics associated with classification of ownership of a waterway in Louisiana and how that ownership, including mineral rights therein can change over time.

In Louisiana, it is well settled that the state owns the beds or bottoms of all navigable waters in the state, whether lakes, rivers or streams, by virtue of its inherent sovereignty (See State v. Capdeville, 146 La. 94, 83 So. 421 (1919). The state of Louisiana owns only the land that is covered by water at its ordinary low water mark; the land lying between the ordinary low water mark and the ordinary high water mark is called the bank and belongs to the owner of the adjacent land. Specifically, under Louisiana Civil Code Article 450, the waters and bottoms of natural navigable water bodies are declared to be public things owned by the state. But, the banks of navigable rivers and streams are private things subject to public use (See La. Civ. Code art. 456). Louisiana Code articles 499 and 500 discuss accretion and dereliction. Accretion formed successively and imperceptibly on the bank of a river or stream, whether navigable or not, is called alluvion. The alluvion belongs to the owner of the bank, who is bound to leave public that portion of the bank which is required for the public use. Alluvion and accretion can be used synonymously. However, accretion is defined as the act of growing to a thing; usually applied to the gradual and imperceptible accumulation of land by natural causes, as out of the sea or river. Accretion is the addition of portions of soil, by gradual deposition through the operation of natural causes. The term alluvion is applied to the deposit itself, while accretion denotes the act. (See Walker Lands v. E. Carroll Parish Police Jury, 38-376, p.8 n.13 (La. App. 2 Cir. 4/14/04). Alternatively, dereliction is formed by water receding imperceptibly from a bank of a river or stream. The owner of the land situated at the edge of the bank left dry owns the dereliction (See La. Civ. Code art. 499). However, there is no right to alluvion or dereliction on the shore of the sea or of lakes (See La. Civ. Code art. 500).

Water bodies that were navigable in 1812, when the state of Louisiana was admitted into the Union, and continue to be navigable are public things (See La. Civ. Code art. 450). Conversely, water bodies that were non-navigable in 1812 and continue to be non-navigable are private things. Questions then arise as to the status of water bodies that have become navigable after 1812 or that have ceased to be navigable after that date (See 2 La. Civ. L. Treatise, Property § 4:2 (5th ed.)). Since the state (in its public capacity) generally owns only navigable bodies of water, and non-navigable waterbodies are privately owned, resolution of many of the issues raised with regard to the above hinge on navigability. Generally speaking, a body of water is navigable in law if it is navigable in fact, and a body of water is navigable in fact if it is capable of being used for commercial purposes over which trade and travel are or may be conducted in the customary modes of trade and travel (See Walker Land, Inc., v. East Carroll Parish Police Jury, 871 So. 2d 1258; and Ramsey River Road Property Owners Association, Imc. V. Reeves, 396 So. 2d 873). Hence, navigability must be proven.

Navigability is a question of fact that may require substantial evidence. Moreover, the peculiar geophysical conditions that prevail at the Gulf coast prevent the drawing of a bright line of demarcation between the sea, rivers, lakes, and other inland non-navigable bodies of water. Thousands of acres of marshlands are traversed by innumerable bayous that empty into lakes, bays, and inlets. Fresh water mixes with salt water on the way to the open Gulf and tides cause salt water to enter into bodies of water further inland and render them brackish. Salinity alone can hardly furnish the criterion for the classification of a body of water as sea or as an inland water body. Moreover, the rather frequent absence of a perceptible current renders difficult the classification of a body of water as a river rather than sea or a lake (See Judith Perhay, Louisiana Coastal Restoration: Challenges and Controversies, 27 S.U. L. Rev. 149, 165 (2000).

According to well-settled Louisiana jurisprudence, land that becomes part of the bed of a navigable river ceases to be susceptible of private ownership; it thus becomes a public thing, owned by the state in its capacity as a public person. It is the same when lands are eroded by the waters of the sea or of a navigable lake and become sea-bottom or lake-bottom (See A.N. Yiannopoulos, Louisiana Civil Law Treatise, Property § 75, at 151-152 (3d ed. 1991); See also, La. Civil Code art. 500). Thus, as private lands erode into navigable water bodies, that new water bottom becomes the property of the state. The state of Louisiana's interest in this eroded land is articulated in the Louisiana Constitution. (See Ryan M. Seidemann, Curious Corners of Louisiana Mineral Law: Cemeteries, School Lands, Erosion, Accretion, and Other Oddities, 23 Tul. Envtl. L.J. 93, 119 (2009). As a result of the foregoing, it is pertinent to note that this change in ownership includes the mineral rights therein. This is significant to oil and gas exploration and development in our state as it affects large amounts of valuable resources.

In response to this transfer to the state of Louisiana of previously privately owned lands, the legislature enacted what is commonly referred to as the “Freeze Statue”. Under Louisiana Revised Statute 9:1151 (hereinafter, the “Freeze Statute”), certain mineral rights in lands transferred to the state of Louisiana by the occurrence of erosion, accretion, dereliction, or subsidence may be protected, in that the mineral owner of said lands (prior to the change) and his lessee will retain those rights that are subject to a valid and outstanding mineral lease for as long as that lease is in effect. The Freeze Statute provides, in full, as follows:

In all cases where a change occurs in the ownership of land or water bottoms as a result of the action of a navigable stream, bay, lake, sea, or arm of the sea, in the change of its course, bed, or bottom, or as a result of accretion, dereliction, erosion, subsidence, or other condition resulting from the action of a navigable stream, bay, lake, sea, or arm of the sea, the new owner of such lands or water bottoms, including the state of Louisiana, shall take the same subject to and encumbered with any oil, gas, or mineral lease covering and affecting such lands or water bottoms, and subject to the mineral and royalty rights of the lessors in such lease, their heirs, successors, and assigns; the right of the lessee or owners of such lease and the right of the mineral and royalty owners thereunder shall be in no manner abrogated or affected by such change in ownership.

The Freeze Statute was first enacted by the legislature in 1952 and was later amended by Act No. 963 in 2001 to specifically include erosion and subsidence and the words sea or an arm of the sea. The effect of the Freeze Statute is that (i) where a change of ownership occurs as a result of accretion, dereliction, erosion or subsidence, and (ii) a mineral lease is being maintained as to that land, said land is acquired subject to and encumbered by any oil, gas or mineral leases covering the property, and subject to the mineral and royalty rights of the lessor, lessee and royalty owners in said lease as long as the lease is maintained.

The question of the constitutionality of the Freeze Statute is well settled. In State v. Placid Oil Co., 300 So.2d 154 (1973), the Supreme Court of Louisiana plainly stated that the Freeze Statute is constitutional and rejected arguments that it is a deprivation of property without due process and an impairment of the obligations of a contract. Additionally, in Cities Services Oil and Gas Corp. v. State (574 So.2d 455 (La. App. 2d Cir. 1991), writs denied, 578 So.2d 132 (La. 1991), reconsideration denied, 580 So.2d 663 (La. 1991), cert. denied, 502 U.S. 863 (1991), the Louisiana 2nd Circuit Court of Appeal, citing Placid and LSU Law Professor Lee Hargrave’s, “Statutory and Horatory” Provisions of the Louisiana Constitution of 1974 (43 La. Law Review 647, 661-662 (1983) explained:

Nothing is taken from the riparian landowner who has gained land by accretion if he obtains the land without the mineral rights; he had no vested interest in the land to begin with. Article IX, section 3 does not prohibit the state, which obtains land by dereliction, from obtaining less than full ownership, as no alienation or authorization of alienation [sic] has occurred.

Cities Services Oil and Gas Corp. v. State dealt with the changing course of the Red River near the boundaries between Caddo and Bossier Parishes between 1966 and 1978. The state of Louisiana asserted claims to ownership of land acquired by accretion in the Red River, and since the state had granted a lease on the former river bed (“State Lease 6002”), the state argued that the new bed was covered by this lease. Two issues were present in this matter: (i) did the coverage of State Lease 6002 remain with the old river bed, change and provide coverage to the new river bed, or did it provide coverage to the old and new riverbed, along with the land formed between the two, and (ii) did the owner of the land formed by accretion have a right to the minerals underlying same under the Freeze Statute.

On the first issue, the Cities court found that State Lease 6002 remained with the former riverbed and did not move to the new bed. The State Lease at issue contained language stating it covered land “now or formerly” constituting the riverbed owned by the state as of a specific date. Due to this language, the court found that State Lease 6002 did not follow the movement of the river. On the second issue, the court (in agreement with the trial court) found the owners of the accretion formed due to the movement of the river were entitled to the mineral rights therein not subject to lease. Thus, the Cities court held that the Freeze Statute “clearly and unambiguously applies only when there is a change of ownership of land or water bottoms caused by the action of a navigable stream and there is in effect a mineral lease covering and affecting the lands or water bottoms.” Furthermore, the Cities court explained “the statute does not require that there be actual mineral production from the leased land in order for the statute to be effective.”As such, under the Freeze Statute and the ruling in Cities, full ownership of land can be transferred as a result of accretion in the absence of a lease. However, if the relevant land is subject to an outstanding lease, then the rights of the lessee(s) and lessor(s) are protected as long as the lease is maintained. Upon termination of the lease, mineral ownership devolves to the owner of the land. Note, just as the state can acquire land with less than full ownership as a result of accretion, dereliction, erosion, or subsidence by application of the Freeze Statute, a riparian (private) land owner can also take advantage of the benefits of the Freeze Statute.

It is important to note that in order for the state to make a claim under the Freeze Statute, the alluvion or accretion formed would have to have formed after the relevant state lease was granted covering a water bottom at the time of the lease (See State v. Cockrell, 162 So.2d 361 (La. App. 1st Cir. 1964).

Waterbodies throughout Louisiana and the Louisiana coast remain some of the most unique areas of the world. These places bounding with beauty and abundant resources are our namesake. We would all do well to understand the challenges involved in development and application of permanent legal rules for the management of these lands where constant physical change can lead to what is land today becoming open water tomorrow.

Amy Duplantis Gautreaux is an attorney in the Lafayette office ofGordon, Arata, McCollam, Duplantis & Eagan LLC. Her practice is focused on oil and gas title examination and oil and gas transactions. Her experience encompasses drafting numerous curative and other legal documents, examination of land, mineral and leasehold title (including abstracts of surface, mineral, royalty, executive right, overriding royalty and leasehold titles and mineral history information), and writing legal opinions including drilling, division order and leasehold title opinions. Aiding her ability to provide an insightful and logical approach to title examination, Amy also worked as an abstractor and landman in South Louisiana after law school. Through her experience, she has developed and maintains great working relationships with many members of the local legal and oil and gas community.After graduating with honors from Catholic High School in New Iberia, Amy attended the University of Louisiana, Lafayette where she earned a Bachelor of Arts in Political Science Pre-Law, magna cum laude and was named Outstanding Graduate in Political Science in 2002. In 2005, she earned her J.D. and B.C.L. from the Paul M. Hebert Law Center at Louisiana State University. She is admitted to practice law in Louisiana.

Professional Affiliations:

 Louisiana State Bar Association

 American Association of Professional Landmen (AAPL)

 Lafayette Association of Professional Landmen (LAPL)

 Houston Association of Professional Landmen (HAPL)

 Lafayette Parish Bar Association (LBA)

 Baton Rouge Association of Professional Landmen (BRAPL)

 Women’s Energy Network (WEN)- Board Member

David John Rogers is an associate attorney in the Lafayette office of the firm Gordon, Arata, McCollam, Duplantis & Eagan LLC who focuses his practice in the oil and gas section focusing primarily on title examinations, oil and gas transactions and litigation involving oil and gas issues. He is a Registered Professional Landman (RPL) and has extensive experience as a project manager handling title opinions, abstracts, due diligence and mineral lease acquisitions in seven states, including Louisiana, Texas, Mississippi, Pennsylvania, Ohio, Colorado and Utah.

Winter Blues: U.S. ‘Winter Natural Gas Prices’ are at Lowest Level in Over a Decade

By energy markets analyst, AlanLammey

So here sits the U.S. natural gas industry knocking on the door of the month of October and prompt-month natural gas futures prices are wobbling between $2.50 and $2.70/MMBtu, which is either at or below break-even for many gas producers throughout the nation. Within the last few days, the ‘November gas futures’ has become the ‘front month’ futures contract and the industry is now officially trading the seasonal period when natural gas prices are historically transitioning into their highest levels of the year. However, what differentiates this year from multiple years gone by is that ‘winter natural gas’ prices are trading at 13-year lows and the coming winter months don’t look very pretty for the gas complex.

This sort of bearish scenario has been frequently repeated for the energy industry over the course of many decades. The oil and gas business in the U.S. has always tended to move in and out of periods of feast or famine with very little moderation in between. However, at this juncture, the industry is in a downright rut. Presently, U.S. wellhead natural gas production is sitting at all-time record highs of 82 billion cubic feet per day (Bcf/d), while total natural gas storage looks to finish the summer ‘refill season’ at a record high amount of 3.9 trillion cubic feet (Tcf) or perhaps higher as of November 1, 2015. As such, with such a major glut of supply, natural gas producers across the country are financially struggling big time to keep their heads above water and natural gas futures traders are pulling their hair out attempting to scrounge-up any sort of gains with the daily spreads in the futures contract fluctuating between measly intraday highs and lows of typically less than 7¢ per day. With this kind of dismal trading action, it’s no secret that the bearishness in the U.S. natural gas market is unarguably at a near historical peak.

So just how bearish is the market? For starters, looking out on the futures curve, one would have to go out to January of 2021 just to find the ‘first’ $3.50s-handle for a gas contract. This in itself is a bit mind-blowing considering that there are plenty of unknowns that could radically change the supply and demand equilibrium over the next 6 years. For example, future summers could be blazing hot, winters may produce record frigid conditions, hurricane seasons might be highly active, and steep production declines could finally set-in resulting from the recent historic drop in rig counts. Second, compared to this time last year when November gas was range trading between $3.50 and $4.00, prompt-month gas prices are down over a $1.00.

But what’s an even bigger barometer of the dreary sentiment prevalent throughout the gas market is that the November gas futures contract is presently trading in the $2.60s. What makes this such a big deal is that the last time that ‘November gas’ traded ‘below’ $3.20 was prior to 2002. Historically speaking, in the past the U.S. gas complex typically sees a ‘surprise rally’ around late September or in early October, but this time around any upside rally in prices is likely to be notably muted as the first part of winter (November and December) doesn’t appear to be very cold in the biggest gas consumption areas of the U.S., according to several of the long-range forecast models. With all this said, because the winter months are dead ahead – which is the largest gas demand period of the year -- from a long-range technical perspective, it doesn’t appear that November prices may fall much below the $2.45-area, because this price point is a historically major area of support for early winter gas. However, that obviously remains to be seen depending on the cold weather intensity (or lack thereof) during the back-half the 2015-16 winter months from January through March.

The acquisition of mineral rights and the commencement of exploration and production operations (“Operations”) pursuant thereto pertaining to lands or mineral servitudes held in indivision is a task fraught with peril. When lands or mineral servitudes are “held in indivision,” transactions and subsequent Operations relating to a mineral lease or servitude are more precarious because obtaining the consent of the co-owners of the underlying interests is a prerequisite for conducting exploration and production activities thereon. However, the comprehensive co-ownership regime found in the Louisiana Mineral Code has established bright-line rules that provide stability and predictability to acquirers of these mineral interests.

First, it is necessary to determine under what circumstances lands or mineral servitudes are “held in indivision” and to articulate the importance of this designation. Generally, “[o]wnership of the same thing by two or more persons is ownership in indivision.” To put it simply, when lands or mineral servitudes are held in indivision, they are, in fact and in law, co-owned.

Notably, the co-ownership of lands and mineral servitudes is a common occurrence. Typically, the co-ownership of such interests results from a contractual disposition or alienation -- in favor of two or more persons -- such as a sale, donation or exchange. In addition, co-ownership of lands and mineral servitudes can further result by operation of law by way of a divorce, a legal entity’s liquidation or dissolution and, most commonly, inheritance. Accordingly, given the prevalence of co-owned interests, the regime of co-ownership established by the Louisiana Mineral Code is increasingly important in the context of not only lease and servitude acquisition, but also subsequent Operations.

II. Co-owned Lands, the Mineral Lease and an Introduction to the “Eighty Percent Rule”

Louisiana Mineral Code Article 166 (“Article 166”) addresses the ability of a co-owner of land to grant a mineral lease and his lessee’s ability to commence Operations. Article 166 provides, as follows:

A co-owner of land may grant a valid mineral lease … as to his undivided interest in the land but the lessee … may not exercise his rights thereunder without consent of co-owners owning at least an undivided eighty percent interest in the land, provided that he has made every effort to contact such co-owners and, if contacted, has offered to contract with them on substantially the same basis that he has contracted with another co-owner. A co-owner of the land who does not consent to the exercise of such rights has no liability for the costs of development and operations or other costs, except out of his share of production.

Although Article 166 empowers a single co-owner to grant a valid mineral lease, the exercise of the right to conduct exploration and production activities on the co-owned property, is conditioned upon the lessee acquiring the consent of “an undivided eighty percent interest in the land.”

For example, if a property is co-owned equally by three sisters: A, B and C, and A grants a mineral lease in favor of an exploration and production company, the company must further acquire the consent of both B and C in order to operate on the leased premises. Absent such consent, the company lacks the power to commence Operations and exploit the mineral resources beneath the leased premises although it has a valid mineral lease.

In contrast, if the property were co-owned equally by five siblings, the company could only be required to acquire the consent of four out of the five siblings in order to commence Operations on the leased premises.

The establishment of Article 166’s “eighty percent rule” is a significant development in Louisiana mineral law and represents a departure from the former law. Prior to the 1986 Amendments to the Louisiana Mineral Code, a mineral lessee could not operate on the leased premises unless he obtained the consent of all co-owners. Consequently, an obstinate landowner with a mere one percent ownership interest could prevent a lessee from developing the land’s mineral resources -- in spite of the fact that a vast majority of the remaining co-owners (holding a ninety-nine percent interest) -- desired the lessee to develop these resources. Needless to say, under the prior law, there was the potential for abuse.

Nonetheless, even the Louisiana Supreme Court upheld this principle. In it’s seminal case, Gulf Refining Company v. Carroll, the Court upheld the right of a noncompliant co-owner to preclude a lessee from operating on the subject property, in spite of the fact that the lessee obtained a mineral lease from the noncompliant co-owner’s son, an owner of an undivided one-half interest in the subject property.

However, the Louisiana Legislature -- both recognizing and acknowledging the potential for abuse -- amended Article 166 twice in order to address the inequitable state of the co-ownership law as it relates to lease operations.

III. The Creation of a Mineral Servitude by a Co-owner of Land

Just as a co-owner of land can grant a valid mineral lease, a co-owner of land may likewise create a mineral servitude out of his undivided interest in the land. This right is memorialized in Louisiana Mineral Code Article 164 (“Article 164”), a parallel provision to Article 166, which provides, in pertinent part:

A co-owner of land may create a mineral servitude out of his undivided interest in the land, and prescription commences from the date of its creation. One who acquires a mineral servitude from a co-owner of land may not exercise his right without the consent of co-owners owning at least an undivided eighty percent interest in the land….

Notably, pursuant to Article 164, although a mineral servitude confers upon its owner the right to operate, when acquiring this right from a co-owner of land (the servitude’s creator), the commencement of Operations is conditioned upon obtaining the consent of co-owners of the land owning at least an eighty percent interest therein.

As a result, the unilateral consent of the creator of the mineral servitude is not dispositive -- despite the fact he is a co-owner of the land. It is the consent of all of the co-owners of the land subject to the mineral servitude that counts. Thus, particular care is necessary when acquiring a mineral servitude created by a co-owner pursuant to Article 164, as the acquirer’s ability to maintain the mineral servitude by Operations may be limited.

IV. Co-owned Mineral Servitudes and the “Eighty Percent Rule”

Co-owners of mineral servitudes are also subject to a similar restriction to lessees who acquire their interests pursuant to Article 166. According to Mineral Code Article 175 (“Article 175”), “[a] co-owner of a mineral servitude may not conduct operations on the property subject to the servitude without the consent of co-owners owning at least an undivided eighty percent interest in the servitude….”

Seemingly, the application of Article 175 is straightforward when viewed in isolation. However, in factual scenarios, wherein a co-owner of lands creates a distinct mineral servitude pursuant to Article 164 and such servitude is also co-owned, confusion abounds.

When seeking to operate on a co-owned servitude obtained from a co-owner of the lands, two “levels” of consent must be obtained from two different classes of persons. First, the party seeking to operate must obtain the consent of co-owners representing at least an undivided eighty percent interest in the land (i.e., Article 164 consent). Second, after obtaining this first “level” of consent, it is still necessary to satisfy Article 175 and obtain the “consent of co-owners owning at least an undivided eighty percent interest in the servitude.” Absent consent from both “levels,” Operations will not be permitted.

Michael C. Wynne is an associate attorney with Ottinger Hebert, L.L.C. His practice focuses primarily on oil and gas litigation and environmental litigation, including royalty disputes and oilfield indemnity disputes. He graduated cum laude from the University of North Carolina at Chapel Hill with a Bachelor of Arts with Distinction in Political Science. He earned his Juris Doctorate magna cum laude from the Paul M. Hebert Law Center at Louisiana State University in 2014.

Nationwide, what is on everyone in our industry’s minds these days? That, I think, can be answered by asking another question. When will this downturn turn around and become a recovery? I guess that question could be asked not only about our industry, but about our nation’s economy as well. If you have the answer to this question please contact me and I will get the word out.

While most of our industry has seen a longer than anticipated slowdown, there are some sectors that have sustained moderate activity levels. Slumping oil prices have, as you are all well aware, caused a significant decrease in new project development and land work has suffered as a result. Many market analysts and industry professionals suggest that this low price level may continue in to next year, but who really knows. Those of us who have been in the oil and gas industry for any length of time realize that these market corrections that take place every 5 to 8 years are difficult, but they do cause us to learn more about our overall industry and give us time to work on our marketing skills - I’m just looking for the silver lining. The sectors that seem to have not been affected as much involve companies that lean on natural gas production as their major income source, since its market price has remained somewhat stable – although a bit low [at just under $3.00/mcf]. The Permian Basin folks seem to be doing a little better than most and some that I have talked with are staying very busy. Many pipeline and acquisition and divestiture projects are still in the mix, but the volatility and low prices don’t bring much energy to move them through quickly.

Well enough of the industry chatter that you are likely already aware of; I just needed to impart my wisdom to the younger members.

News about our AAPL Headquarters: Many of us have now met our new Executive Vice-President, Melanie Bell, and I for one am thoroughly impressed. Melanie’s qualifications are impressive and she appears to be a very capable replacement to Marty Schardt. Of the eight staff vacancies that opened this year, four have been filled and four remain to be filled, namely to be filled, Publications/Marketing Manager, Business Development Assistant, Marketing/PR Assistant and Publications Assistant. There will be an Open House held on the afternoon of Wednesday, November 11, 2015 at the new headquarters building at 800 Fournier Street, Ft. Worth. Invitations will be extended to all members, city and governmental officials, NAPE Partners, clients and vendors.

NAPE: One would think that with the loss of so many landmen and the status of our industry that NAPE would have shown diminished attendance numbers, but that wasn’t the case for Summer NAPE. The numbers were similar to last year’s attendance when oil prices were about double what they were this summer. They attribute the stable attendance to interest in the new Wednesday/Thursday format and advertising. Other industry expos were not as well attended and took a huge hit on attendance compared to last year.

The AAPL Marketing Committee announced that they are expanding the Ambassador Tool Kit that is available on AAPL’s website. It will now include data and infographics regarding the latest industry research findings and developments, such as the EPA’s recent ruling regarding hydraulic fracturing. The tool kit can be used to counteract misinformation and to equip local associations and members with the necessary information to present to influential businesses and members of their local communities.

The new Joint Operating Agreement (JOA) has been finalized by the Form 610 JOA Revision Task Force and approved by the AAPL Board. The Task Force, which is comprised of eight lawyers/landmen from different national regions, has developed a much improved JOA that has addressed the issues found in the 1982, 1989 and “Horizontal” forms. The methods used to identify and fix the forms’ problems ranged from polling users, reviewing court cases to interviewing peer groups to obtain comments. The work is said to have been of the highest caliber and the form incorporates issues associated with the latest technological advances as well as cleaning up definitions and overall confusion contained in the previous forms. While it will never be a “go with, sign here” form, it should be considered as a superior general form. A roll-out of the form is tentatively planned for the 2nd week in November to introduce it to the industry. They hope to have it available either on Forms-on-a-Disk or directly on the AAPL website around the beginning of the year barring any installation issues.

As a reminder, the 50% reduced rate for AAPL-sponsored educational events continues through the end of the year as well as the 25% reduction in materials.

The AAPL Gulf Coast Land Institute is set for Wednesday, Oct. 21-Friday, October 23, 2015 at The Doubletree Hilton Lafayette. Eleven speakers covering an array of topics have been scheduled and the event will provide 11 AAPL credits including 1 Ethics credit.

PLEASE GO TO AAPL WEBSITE AT www.landman.org FOR REGISTRATION PARTICULARS!!!

An ice breaker & Legends Night will be held on Wednesday, October 21 at La Fonda, which will be hosted by LAPL.

A prayer breakfast will also be held on the morning of Friday, October 23 at The Doubletree Hilton Lafayette.

Links:

LOUISIANA LEGAL UPDATE

By Lauren L. Gardner

Onebane Law Firm

What Does the Future Hold for Imprescriptible Mineral Rights?

In the 2015 Regular Session of the Louisiana legislature, Senator Gallot introduced Senate Bill No. 148, proposing to amend Article IX, Section 4 of the Constitution of Louisiana, to provide that a mineral interest of the state, school board, or levee district, on land belonging to another shall be subject to the same prescription of non-use without interruption as is provided by law for a mineral interest privately held. Senate Bill No. 148 was referred to and debated in Senate Judiciary A Committee, which can be viewed online in the Broadcast Archives of the Louisiana legislature. This bill did not make it out of committee so there will be no Constitutional Amendment proposed to the voters this November and our law on imprescriptible mineral rights remains the same for now.

The changes proposed in this Constitutional Amendment would significantly change our law on imprescriptible mineral rights. Although this bill failed, it is interesting to see if the issue will be brought up again in future sessions. With this bill being introduced, it is worth revisiting our history of the State's ownership in mineral rights, and the imprescriptible nature of those mineral rights. Our laws can be broken down into two categories: (1) those that deal with the issue of the State owning real property and the limitations on its divestiture of same; and (2) those that deal with the State acquiring real property from a private individual or entity where a mineral reservation is involved.

The General Rule is that the State Cannot Alienate its Mineral Rights

Article IV, Section 2 of the 1921 Constitution of Louisiana contained a prohibition against the sale of mineral rights by the State, providing that the mineral rights on any and all property sold by the State shall be reserved, except where the owner or other person having the right to redeem may buy or redeem property sold or adjudicated to the State for taxes. Since the adoption of our 1921 Constitution, except for a redemption of a tax sale, any transfer of property from the State will not include the minerals, regardless of whether a mineral reservation is mentioned in the transfer. While the 1921 Constitution contained a prohibition against the sale of mineral rights by the State, there was no prohibition on the running of prescription against the mineral rights held by the State. The imprescriptibility of these mineral rights is a consequence of their insusceptibility of private ownership under Civil Code Article 450.

Louisiana adopted a new Constitution in 1974. Our current Constitution prohibits the sale of mineral rights by the State; and includes a prohibition against the running of prescription on these mineral rights.Article IX, Section 4 of our Constitution provides that mineral rights on property sold by the state shall be reserved, except when the owner or person having the right to redeem redeems property sold or adjudicated to the state for taxes. Our Constitution further provides that the mineral rights on land contiguous to and abutting navigable water bottoms reclaimed by the state through the implementation and construction of coastal restoration projects shall be reserved, except when the state and the landowner having the right to reclaim or recover the land, have agreed to the disposition of mineral rights in accordance with law. Additionally, our Constitution provides that lands and mineral interests of the state, school board, or levee district shall not be lost by prescription.

Senate Bill No. 148 would not have changed the prohibition that the State cannot divest itself of its mineral rights, but, if passed by the voters, it would have amended our Constitution to allow the running of prescription against those mineral rights retained by the State, school boards, and levee districts.

When a Private Person or Entity Reserves Mineral Rights in a Transfer to the Government or Governmental Authority, the Date of Creation of the Mineral Reservation is Essential in Determining if it Imprescriptible

It should first be noted that the Constitutional amendment proposed in Senate Bill No. 148, if passed, would have had no effect on the law dealing with the reservation of mineral rights in property acquired by the government and governmental agencies, which is discussed below. Our statutory framework for imprescriptible mineral rights began in 1938. The original acts tied the imprescriptible nature of the mineral right at issue with the purpose for which the government acquired the land subject to the mineral right. Act 151 of 1938 provided that when real estate is acquired by the United States of America, the State of Louisiana, or any of its subdivisions, from any person, firm or corporation, for use in any public work and/or improvement, and by the act of acquisition, oil, gas and/or other minerals or royalties are reserved, prescription shall not run against such reservation. Act 68 of 1938 provided that whenever land situated in any spillway or floodway is sold to or acquired by the United States or the State of Louisiana, or any subdivisions or agencies thereof, for use in the construction, operation or maintenance of any spillway or floodway constructed, operated or maintained under the Flood Control Act, or any other Acts of Congress, and the owner of said land reserves or retains the mineral rights in said land, such rights shall be imprescriptible. Both acts were approved by the governor on July 2, 1938.

In 1940, our law changed with the passage of Act 315. This Act provided that when land is acquired by conventional deed or contract, condemnation or expropriation proceedings by the United States Government, or any of its subdivisions or agencies, from any person, firm or corporation, and there is a reservation of the minerals in such act, verdict, or judgment, the land; or the land so acquired is subject to a prior sale or reservation of the minerals, which is still in force and effect, shall be imprescriptible. This Act was approved by the governor on July 20, 1940, and repealed Acts 68 and 151 of 1938. Accordingly, mineral rights reserved in a transfer to the state and federal government were imprescriptible from 1938-1940; but from 1940-1958, only mineral rights reserved in transfers to the federal government were imprescriptible. In 1950, Act 315 of 1940 became known as La. R.S. 9:5806. Act 278 of 1958 added Subsection B. of La. R.S. 9:5806, which provided that when land is acquired by conventional deed or contract, condemnation or expropriation proceedings by the State and any board or commission, created or established by the State of Louisiana, from any person, firm or corporation, and by the act, order or judgment, minerals are reserved, the rights so reserved shall be imprescriptible and shall remain vested in the person, firm or corporation from whom the land was acquired, condemned or expropriated, or in the heirs or assigns of that person, firm or corporation; provided that prescription will begin to run again should the ownership of such land be transferred to a private party. This was the law governing these imprescriptible mineral servitudes until the Louisiana Mineral Code was enacted.

The Louisiana Mineral Code was enacted by Act 50 of 1974, and became effective on January 1, 1975. From January 1, 1975, through August 1, 2004, Louisiana Mineral Code Articles 149 through 152 governed mineral rights in land acquired or expropriated by governments or governmental agencies.

From August 1, 2004, through the present, Mineral Code Article 149, as revised and amended, governs mineral rights acquired by the State and its agencies. This article provides, that when land is acquired by certain "acquiring authorities", as defined therein, through act of sale, exchange, donation, or other contract, or by condemnation or expropriation, and a mineral right is reserved in the instrument or judgment, prescription of that mineral right is interrupted as long as title to the land remains with the acquiring authority, or any successor that is also an acquiring authority. If a mineral right subject to prescription has already been established over land at the time it is acquired by an acquiring authority, the mineral right shall continue to be subject to the prescription of non-use to the same extent as if the acquiring authority had not acquired the land. Upon the extinction of such mineral right, the transferor of the land shall without further action or agreement, become vested with a mineral right identical to that extinguished, provided that the instrument or judgment by which the land was acquired expressly reserves or purports to reserve the mineral right to the transferor, and the land is still owned by an acquiring authority at the time of extinguishment.

Additionally, although not imprescriptible, this article also provides a twenty (20) year prescription of non-use for certain transactions by an acquiring authority or other person, when such transaction is part of an economic development project pursuant to a cooperative endeavor agreement.

Our law on imprescriptible mineral rights has certainly changed and evolved over time. For now, it remains the same, but we should be aware that this issue is on the minds of our legislators and it may be revisited in future legislative sessions and subsequently changed again.

Hello, hello, hello!!!!!! I would like to start off by saying, welcome back to all of our wonderful members!!!!! And to all of you out there who have been thinking about joining the LAPL or know of someone thinking about joining, we want to extend a welcome to them as well. We would love to have them as part of our association! September 1st marks the official new year for the LAPL, so please keep an eye out for the LAPL Membership Renewal form. This form is for you to review, make changes to and return to us, and will help us in making sure that we have all of your current and up to date information, so that you receive your newsletters, emails and any other information that we send out throughout the year.

We are very excited to announce that we will be having our Annual Kick-Off Party again at Antlers downtown! Last year was a great success and a lot of fun. The date for this event is Sunday, September 13th at 2:30 p.m.. Kick off is at 3 p.m.. This is a great opportunity to apply for or renew your membership, pay your membership dues, or bring a friend that might be interested in joining the LAPL, all while kicking off the football season with many of your friends and colleagues. The Saints will be taking on the Arizona Cardinals. There will be food, drinks, door prizes, cash prizes and of course the Saints game! We will also have a football pool for those who are interested in doing a little betting!

IF YOU INTERESTED IN HELPING OUT WITH THIS EVENT PLEASE CONTACT: Jamie Castille, Angela Benedict or Mandy Barrilleaux. You can find their contact information on Page 2, right next to this letter.

Finally, we would like to give a HUGE thank you to all of our amazing sponsors! This event is free because of them. So come on out and meet someone new, introduce a friend to someone, shake someone’s hand! It’s going to be a blast so I hope to see everyone there!!!!!

The LAPL Executive Committee is excited and pleased to announce that we now offer ONLINE REGISTRATION for our regular luncheon/meetings! Starting now, you can sign up for our Friday, September 25, meeting at the Petroleum Club.

Because of PayPal's processings fees, the cost is $22/person, as opposed to $20/person at the door. Also, if you need to register and pay for several people (up to 10), you may do so now ONLINE. However, if you would still prefer to pay at the door, that remains an option. Checks payable to the LAPL are accepted.

To register online, click on the link below. You will find everything you need to know about the September 25 meeting and how to pay.

The Lafayette Association of Professional Landmen annual kickoff party is to be held at Antler's in downtown Lafayette, Louisiana starting at 2:30pm until 8pm on September 13th. Food, fun, football pool with cash prizes and door prizes to be given away. It is free to all who attend and we are welcoming sponsors. Please contact Jamie Castille: (337) 962-9948 or email jcastille61179@aol.com for more information. We thank you for your continued support!

DEADLINE FOR SPONSORSHIPS: TUESDAY, SEPT. 8!

Links:

Last year the LAPL and UL Lafayette Foundation teamed up to establish the PLRM Promise campaign to lend financial support to the Moody College of Business Professional Land and Resource Management Program. The LAPL committed to a three-year $15,000 donation paying a minimum of $5,000 per year with the first fiscal year commencing August 1, 2014-July 31, 2015. The final first year tally resulted in $5,783 in contributions.

Year number two commenced August 1, 2015, and the LAPL continues its commitment to encourage additional contributions. Julie Falgout, President and CEO of the UL Lafayette Foundation, established an LAPL account and reminds everyone no amount is too small and all donations are tax deductible. Instructions on how to give are listed on the flier printed in every newsletter. Just look for the big red thermometer, usually on page 9.

PLRM Promise donations do not fund the LAPL Scholarship Program but do provide direct university support to the PLRM Program. Scholarships are funded by proceeds from other LAPL annual events, such as the crawfish boil, golf tournament and educational seminars.

The ULL Professional Land and Resource Management Program has taken giant steps of excellence in recent years and our industry is the primary beneficiary. We’re tops in the nation and strive to stay there. However, the cost of educating young professionals continues to climb and ULL needs our help.

Thank you for your consideration and continued support of this important campaign.

American Association of Professional Landmen - Director Update

Damon R. Weger, CPL

August 7, 2015

Networking is important for landmen, and LAPL and AAPL offer many opportunities to do just that! In our current industry slowdown I feel it is important to urge all of our members to take full advantage of every event that our associations sponsor.

This LAPL Newsletter provides information on our upcoming events as does our website. Most all of the individuals that I have had the honor to get to know through our association, and through AAPL, are of the highest character and have become close friends. Further, I feel certain that many business exchanges and company hires are a result of a contact made through LAPL or AAPL.

As your AAPL Director, I feel it important to express my thoughts as how best to take advantage of your LAPL membership and to urge each of you to become involved in AAPL through its networking opportunities and its certification program. First, at the local level it is a good idea to attend as many LAPL events as you can – most of us can’t make all of the events, but it is great to visit with fellow industry friends. Secondly, get involved in the planning process by helping out at the committee level and maybe working your way up to the Executive Committee where the decisions are made.

Becoming certified in our industry is becoming more important than ever! Those who we do business with, landowners and company contacts, are quickly becoming more educated as to who we are as landmen and what holds many of us accountable to a set of ethical and educational standards. Most everyone we meet will communicate with their friends through Facebook or some other social media outlet to let them know what is happening in their daily lives, and when we become a part of that conversation our reputations are exposed for what they are. All anyone has to do is type in landman and they can find out exactly what certifications are available to us and will then ask you about your education and what holds you accountable to ethical standards. What will your answer be?

If you have recently entered the landman industry, you may want to start your certification by becoming a Registered Landman (RL). This is a temporary designation available for landmen who do not have work experience to qualify for the higher certifications of RPL and CPL. RL signifies a fundamental knowledge of the land industry as well as a landman’s commitment to furthering their education.

Next, the mid-level designation offered by AAPL, Registered Professional Landman (RPL) certification, distinguishes a landman as knowledgeable, experienced and professional. Finally, the highest designation offered in the energy management industry is the Certified Professional Landman (CPL). This certification is the standard by which landmen demonstrate their comprehensive competence, proficiency and professionalism in the landman field.

The times may be difficult for some, but as things begin to pick up we will be stronger and more tested. Become the best that you can through education and networking!

HPS OIL & GAS PROPERTIES, INC. is currently seeking Landmen with a minimum of five (5) years’ experience. Must be able to perform all tasks associated with Due Diligence Projects. Interested parties without restrictions on travel and extended out of town stay are preferred. Please email resume’ to geraldb@hps-og.com or mail to the following:

The Executive Committee of the LAPL would like to welcome its newest members and applicants:

New Applicants:

David J. Vanicor

Active, Lafayette, LA

David N. Mayeaux

Active, Lafayette, LA

Blaine J. Hebert

Active, Youngsville, LA

Sharon Mouledous

Active, Lafayette, LA

Belinda A. Fife

Active, Lafayette, LA

New Members:

Jason Peterson

Active, Lafayette, LA

Alex Prochaska

Active, Lafayette, LA

Charlie Doucet

Active, Lafayette, LA

Robert W. Scheffy, Jr.

Active, Baton Rouge, LA

Catherine L. Bergeron

Active, Ventress, LA

Roger D. Lehman

Active, Lafayette, LA

If you have any questions about Membership in the LAPL, please contact Mandy Barrilleaux, RPL, at mandybarrilleaux@gmail.com or call 337-962-1922. The LAPL mailing address is P.O. Box 53491, Lafayette, LA 70505.